CAPE TOWN (Realist English). The conflict in the Persian Gulf and the effective blockade of the Strait of Hormuz, through which a fifth of the world’s oil passes, have forced the largest hydrocarbon importers to rethink their approach to energy security.
India and the Republic of South Africa — two countries critically dependent on oil imports — have announced ambitious programmes to expand their Strategic Petroleum Reserves (SPR).
India: From 8–9 Days to 74 and Beyond
India, which imports more than 80% of its oil consumption, has proven particularly vulnerable to shipping disruptions in the Strait of Hormuz. The country’s existing strategic reserves, located in Mangaluru, Padur, and Visakhapatnam, have a total capacity of 5.33 million tonnes (about 39 million barrels) — enough for only 8–9 days of net import cover.
In July 2026, Indian authorities and state‑owned companies took a series of steps to drastically increase reserves.
New Storage Facility in Mangaluru
State‑owned Oil and Natural Gas Corp (ONGC) received approval to build a strategic storage facility in Mangaluru (Karnataka state) with a capacity of 1.75 million tonnes (about 13 million barrels) .
This is the first time a state‑owned company has invested its own funds in creating strategic rather than commercial reserves.
Phase II of the SPR: More Than Doubling Capacity
In parallel, the Indian government is implementing a second phase of its strategic reserve programme, worth 14,527 crore rupees (approximately $1.7 billion). As part of this phase, two underground storage facilities are being built:
- Chandikhol (Odisha) — 4 million tonnes
- Padur (Karnataka) — 2.5 million tonnes
These two facilities will add 6.5 million tonnes (47.6 million barrels) of emergency stocks, more than doubling the government’s strategic reserves. The project is being implemented through a public‑private partnership.
Taking into account the existing 64–65 days of stocks held by oil marketing companies, India’s total crude oil and petroleum product storage capacity reaches 74 days. After the completion of the second phase, this figure is expected to rise to 86 days.
South Africa: The First Large‑Scale Project Since Apartheid
The Republic of South Africa, also a net importer of oil and petroleum products, has announced plans to create a strategic reserve of 36 million barrels — the first large‑scale expansion of emergency stocks since the apartheid era.
Reserve Structure: 60–90 Days and the Private Sector
According to the policy document published by the Ministry of Mineral and Petroleum Resources, the government intends to maintain emergency stocks equivalent to 60 days of national demand (or net imports). Approximately 70% of the reserve will consist of crude oil, with 30% being petroleum products (diesel, petrol, jet fuel). In the longer term, the target may be increased to 90 days.
The reserve will be managed by the state‑owned South African National Petroleum Company (SANPC) and stored in existing government facilities in Saldanha and Milnerton.
In addition to the government reserve, the project provides for mandatory stocks for the private sector: licensed producers and wholesale fuel suppliers will be required to hold 14 days of stocks. The total volume of mandatory stocks could reach 21 days.
Reasons: Lost Refining Capacity and Economic Vulnerability
South Africa has lost about half of its refining capacity in recent years, increasing its dependence on imported fuel. According to government estimates, the country consumes about 27 billion litres of petroleum products annually, and the transport sector is 90% dependent on liquid fuels.
Minister of Mineral and Petroleum Resources Gwede Mantashe called the project the “most ambitious energy security commitment” since the apartheid era. The policy document was published for public consultation in early July.
Context: The Iran War and the Strait Blockade
The trigger for the large‑scale investments was the conflict in the Persian Gulf. In March 2026, the 32 member countries of the International Energy Agency (IEA) agreed on a record release of 400 million barrels of oil and petroleum products from emergency reserves. The US released 172 million barrels from its Strategic Petroleum Reserve.
However, as analysts note, global energy crises are becoming the “norm rather than the exception.” The blockade of the Strait of Hormuz, through which a fifth of the world’s oil passes, has exposed the vulnerability of import‑dependent countries.
Neither country has yet disclosed the exact timelines for implementation or the financing mechanisms. However, the very fact that major oil importers are taking such large‑scale steps to create their own “safety cushions” indicates that the world is preparing for long‑term instability in energy markets.
As Indian Minister for Petroleum and Natural Gas Suresh Gopi noted, “the government is constantly monitoring and assessing threats that could lead to potential disruptions in energy supplies.” South Africa, for its part, has stated that the policy is aimed at reducing vulnerability to volatility in international oil markets and geopolitical crises.
